The People's Bank of China--News

Financial Performance Remained Stable in July

Money supply grew 16.35%. At end-July 2008, broad money (M2) stood at RMB 44.64 trillion, increasing 16.35% year on year, down 0.39 and 1.02 percentage points from end-2007 and the end of last month respectively. Narrow money (M1) registered RMB 15.5 trillion, rising 13.96% year on year, down 7.09 and 0.23 percentage points from end-2007 and the end of last month respectively. Cash in circulation (M0) grew 12.3% year on year to RMB 3.07 trillion. Net cash injection from January to July totaled RMB 31.2 billion, up RMB 5.8 billion year on year.

RMB loans increased 14.58% year on year. At end-July, outstanding RMB and foreign currency loans of financial institutions totaled RMB 30.88 trillion, rising 15.46% year on year. Outstanding RMB loans grew 14.58% year on year to RMB 29 trillion, down 1.52 percentage points year on year but up 0.46 percentage points month on month. RMB loans registered an increase of RMB 381.8 billion in the month, up RMB 150.4 billion year on year. By sector, loans to households increased by RMB 49 billion, down RMB 61.3 billion from the same period last year. In breakdown, short-term loans and long and medium-term loans grew by RMB 11.5 billion and 37.5 billion respectively. Loans to non-financial companies and other sectors rose by RMB 332.8 billion, RMB 211.6 billion more than the growth in the same period last year. In breakdown, short-term loans, long and medium-term loans and bill financing increased by RMB 85.7 billion, 165.9 billion and 76.6 billion respectively. From January to July, RMB loans rose by RMB 2.8343 trillion, accelerating by RMB 60.5 billion year on year. At end-July, outstanding foreign currency loans of financial institutions totaled US$274.7 billion, up 45.03% year on year. Foreign currency loans decreased by US$600 million in the month, as compared with the US$4.2 billion increase in the same period last year.

RMB deposits grew 19.6% year on year. At end-July, outstanding RMB and foreign currency deposits of financial institutions totaled RMB 45.53 trillion with a year-on-year growth of 18.79%. Outstanding RMB deposits increased 19.6% year on year to RMB 44.37 trillion, up 0.75 percentage points month on month. RMB deposits registered an increase of RMB 468.2 billion in the month, up RMB 309.7 billion year on year. By sector, household deposits grew by RMB 246.5 billion, accelerating by RMB 255.6 billion year on year; deposits of non-financial companies dropped by RMB 5.5 billion, RMB 700 million less than the fall in the same period last year; fiscal deposits rose by RMB 184.8 billion, decelerating by RMB 34.1 billion year on year. From January to July, RMB deposits recorded a RMB 5.4331 trillion increase, RMB 1.8871 trillion more than the growth in the same period last year. At end-July, outstanding foreign currency deposits of financial institutions rose 4.37% year on year to US$169.4 billion. Foreign currency deposits surged by US$5.6 billion in the month, up US$10 billion year on year.

RMB transactions in the inter-bank lending market were brisk and market rates remained stable. In July 2008, RMB transactions in the inter-bank lending market amounted to RMB 9.27 trillion. The average daily turnover reached RMB 403.2 billion, increasing by 40.9%, or RMB 117 billion, year on year.

In July, the monthly weighted interest rate for inter-bank lending averaged 2.69%, down 0.38 percentage points from the previous month but up 0.36 percentage points from the same period last year. The monthly weighted interest rate for bond pledged repo averaged 2.76%, down 0.32 percentage points month on month but up 0.23 percentage points year on year.